1. You are given the equation X= 4,000 +100Y +5W^2 and M= 1,000 +50W. Your company has been allotted debt at 30%. Your goal is an ROR of 15% and the debt to be equal to 8% with a tax of 20%. With W=20 and a price of 425 what is the 1. return on equity? 2. Economic profit 3. Theta?
2. In what respect is preferred stock similar to bonds, and in what respect is it similar to common stock? Please use examples to better demonstrate your explanations.
3. Project K costs $70,000, its expected cash inflows are $15,000 per year for 8 years, and its WACC is 10%. What is the project's MIRR? Round your answer to two decimal places.